Australia’s competition regulator is intensifying its push to outlaw ‘dark patterns’, a collection of tactics digital platforms use to confuse customers, encourage them to act against their own interest, or keep paid services they no longer want.
Speaking to The Age, Gina Cass-Gottlieb, chair of the Australian Competition and Consumer Commission (ACCC), said new rules are required to ban the myriad ways digital platforms can unfairly handle their customers.
Cass-Gottlieb focussed on the so-called ‘subscription trap’, a kind of ‘dark pattern’ which makes it far easier for customers to sign up for a digital service than cancel it.
Apps and online services which initially offer a free or low-cost trial are of particular concern, she said, as unfair or impractical cancellation processes can leave consumers paying for a service they would otherwise drop.
The ‘subscription trap’ is one of several ‘dark patterns’ identified by the ACCC’s ongoing Digital platforms services inquiry, the watchdog’s primary investigation of how online players are cornering customers and constricting competition.
In its September 2022 interim report, the ACCC said ‘dark patterns’ can include false scarcity reminders, low stock warnings, and countdown timers designed to accelerate an online shopper’s purchasing process.
Pre-selected add-ons can also constitute a dark pattern, the ACCC said.
Those measures extend beyond e-commerce platforms, as the report noted that app developers can swap colours, button orientations, and text sizes to counter user expectations.
For example, ‘No’ buttons can be displayed in green, rather than the traditional red, and the ranking of important cancellation buttons can be altered halfway through the process.
The ACCC is even concerned about what it has termed ‘concern shaming’, “where wording on a button or link is presented in such a way that it may use guilt to push the consumer into doing something they wouldn’t have otherwise done.
“Examples provided in the literature include encouragements for users to provide email addresses in exchange for a discount with links to statements such as ‘No thanks, I hate saving money’ if they do not wish to do so.”
Small businesses are not immune from such practices, the ACCC said.
Echoing the report, Cass-Gottlieb said Australia should consider blanket legislation outlawing unfair trading practices, in order to stamp out new ‘dark patterns’ if and when they arise.
The ACCC argues an economy-wide ban would limit problematic conduct which, as it stands, is unlikely to breach Australian Consumer Law and the patchwork of industry codes of conduct designed to stamp out poor behaviour.
Cass-Gottlieb has previously called for a general unfair practices provision since stepping into the role of ACCC chair last year, noting that several international jurisdictions have those rules in place.
“The increased capacity for manipulation of consumer choices in the digital economy reinforces the need for a new economy-wide unfair trading practices prohibition,” she said in March.
Enacting that kind of legislation would be a matter for Federal Parliament.
Those pleas do appear to have a sympathetic ear in Assistant Minister for Competition, Charities and Treasury Andrew Leigh, who last week identified ‘dark patterns’ as a key concern.
Reforms to crack down on ‘dark patterns’ could take the form of blanket legislation, he said, but the federal government is not ruling out the potential benefits of targeted reforms.
“We’re open-minded about both of those approaches to tackling ‘dark patterns’, but they’re clearly invidious in their effects on competition and widespread in the online world,” he told SmartCompany.
Senior Business Journalist
Focused on the small business sector, David’s work covers the political, regulatory, and economic issues facing Australian entrepreneurs. Prior to joining SmartCompany, he was a reporter for Business Insider Australia. You can follow him on LinkedIn.
